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THE SCENARIO
A money-saving or debt-reduction strategy I've heard many times is some variant of 'make an extra payment every year on your mortgage to pay it off faster'. Sometimes, this is couched in making a half-payment every 2 weeks (which adds up to 13 full payments every year), but the end result is the same: paying extra principal in order to shorten the total time it takes to pay off the loan (and reduce the amount of interest you ultimately end up paying).
To keep things simple, we're going to figure out the effect of making an extra payment every year, but spread evenly as extra principal paid every month (i.e. take the extra payment, divide it by 12, and add the result to each normal payment). I'll call this the 'enhanced' payment thro...
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